My Dave Ramsey Endorsed Local Provider Experience

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A while back I met with a Dave Ramsey Endorsed Local Provider (ELP) because I didn’t know who I could trust with my money.  Dave seemed trustworthy so I gave his ELP a shot.

What Is A Dave Ramsey ELP?

I first heard about Dave Ramsey ELPs’ from the Dave Ramsey Show. After every conversation, he would end by suggesting the person on the other end of the line reach out to either a Smart Vestor Pro or one of his ELPs.

After a little research, I found Dave Ramsey “certifies” people in the following categories:

  • Real Estate Agents
  • Property And Casualty Insurance Agents
  • Tax Service CPAs or EAs
  • Long Term Care Insurance Agents
  • Health Insurance Agents

Dave’s team evaluates each potential ELP to ensure they:

  • Offer Topnotch Customer Service
  • Are An Independent Insurance Agent
  • Agree With What Is Taught In Financial Peace University
  • Are Held To A Higher Standard

Dave Ramsey ELPs PAY To Be Endorsed

It turns out, if you pass Dave Ramsey’s test and “agree to work in the best interest of the client“, and “have the heart of a teacher,” you are fortunate enough to receive Dave’s endorsement.

What does this mean?

This means each ELP is able to pay $400 – $900 a month to receive “leads.” In other words, for every person that is referred to the ELP from Dave, the ELP is required to pay Dave Ramsey for that referral.

The amount required to pay for the lead depends on the size and population of people in the area.

In other words, Dave Ramsey makes a TON of money from ELPs who pay him for leads. Many ELPs state they are required to pay $45 – $60 dollars per person that are referred to them.

Some estimations are ELPs’ earn Dave $400,000 – $900,000 a month from their fees alone.

My Search For Personal Finance Answers

I thought Dave Ramsey's ELP was my missing piece

When I started my financial journey, I knew nothing about money or investments.

Luckily, I didn’t have too big of a debt problem of my own, but I had a lack of financial investment knowledge and proper money management. I was able to save money, but I didn’t know what to do with it.

I listened to Dave Ramsey on the radio for investment advice, but all he ever recommended was to call one of his ELPs, or “Endorsed Local Providers.”

The idea of meeting with a financial adviser didn’t sit well with me because I knew most advisers work off commissions. However, I found Dave Ramsey sounded trustworthy, and I subscribed to much of what he taught.

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Due to this, I logged onto his website and put my zip code in to find a local ELP that I could visit.

With a quick search, I was referred to a local investment firm that quickly called me to set up a consultation.  I set up the consultation for a later date and did some research of my own on Dave’s ELPs’. 

I found that in order to be a Dave Ramsey, “ELP” you have to pay several hundred dollars to Ramsey Solutions and you have to agree to “have the heart of a teacher.”

In addition, you are required to subscribe to his methodology in order to receive the endorsement.  The more I researched ELPs, the more I found they were a money generator for Dave Ramsey. 

This isn’t to say that they were not trustworthy, but it made me skeptical.

Meeting With Dave Ramsey’s Endorsed Local Provider

my first meeting with an ELP

When my wife and I walked into the office, I scanned the ELP’s personal pictures sitting on her desk and I looked at the disorganization of strewn papers everywhere.  First impressions are important to me, and it didn’t seem like this ELP was squared away or on top of it.

We sat down and chatted to get to know each other.  This lady was in her 50s’ and was talking about how she is doing her best to put her daughter through college.  As we made small talk, I was judging this lady during the conversation. 

I couldn’t help it.

If I’m going to be receiving financial advice from someone, I want to make sure they have their own financial life in order.  The more I talked to her, it was clear she was knowledgeable about investments, but she didn’t necessarily know how to handle her own daily finances.

Needless to say, we spoke at length about my finances and my goals and dreams, and I told her I would consider working with her in the future.  We parted ways and the truth is, I had no intention of returning. 

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She only solidified my fears that I started out with.

She was not the expert I was looking for in order to educate and direct me with my finances. It was apparent I was in a better financial position that this “expert” who was endorsed by Dave Ramsey. 

The ELP called me several times after that, obviously desperate for my business which only pushed me further away.

My Journey To Find The Truth About Money

arizona asphalt beautiful blue sky

Since I was in the same position and still didn’t trust any financial professionals I had met, I decided I would educate myself on personal finance.  I started out by reading every one of Dave Ramsey’s books (even with the bad ELP experience).

After that, I branched out to Tony Robbin’s finance books, and then started checking out every investment and finance book I could find at the library. 

With each book I read, I learned a little more.  I learned who I could trust and who I could not.  I learned who was selling books for profit, and who was selling books to actually help people.

What is a Fiduciary?

Several times I came across the term “fiduciary.”  I had never of it and I was curious as to what it meant.  I learned that in the financial world, there is a ton of misinformation and deceptive people – but there are also those who genuinely want to help others succeed.

A fiduciary, in the financial industry, is someone who is legally required to offer the best financial advice and direction to their client – even if it’s not in the best interest of the fiduciary’s business. 

For instance, if someone is truly a registered fiduciary and acting like one, he must recommend the investment portfolio or fund that is best suited for you personally, and not the one that will offer him the biggest commission.

Due to this, many fiduciaries charge a flat fee to their clients because they don’t work off commissions as regular brokers do.

The more I learned about fiduciary’s, the more I liked the idea.  They charge around 1% to manage your investments and generally don’t work off commission. 

Commissioned sales are terrible for the consumer because the consumer is at a disadvantage.  If you have ever been to a car dealer – you know what I mean.

Fiduciary Games

The games in the finance industry

As I delved more into the world of finance, I came across a shocking fact.  Dave Ramsey’s ELPs’ are NOT required to be fiduciaries! 

Dave Ramsey, who touts his commitment to helping people, does not require his endorsed financial advisers to work in the best interest of their clients!

This hurt my impression of Dave Ramsey because it was apparent he was not willing to restrict his endorsements at the risk of hurting his income.

As I talk about fiduciaries, do not be fooled into thinking that they are the end-all, be-all of finance.  There are people who are fiduciaries, who are also brokers that work off commission.  They can wear their fiduciary hat one minute, and take it off and put their standard broker hat on the next minute.

Brokers Are NOT All Bad

I have been giving the standard broker a hard time in this article but I want to defend those honest brokers who are out there.  There are many brokers who are not fiduciaries, that do put the interest of their clients before their own.

Many brokers give excellent financial advice and are the right choice.

Some commission-based brokers act as fiduciaries without the official title.  The fiduciary label is just an extra layer of protection that you can use towards your choice in a financial adviser.

Who Can You Trust?

Learn who you can actually trust in the finance industry.

So how does anyone win?  If there are genuine people out there in between those who are trying to swindle you, how do you find them? 

I would strongly recommend educating yourself as much as you can.  All of this financial information may be extremely boring to you and I don’t expect you to be an expert.

However, for your own sake, at least educate yourself on the basics of finance. By educating yourself, you will be able to recognize bad advice when you hear it. 

If someone recommends putting all your money in Amazon stock, you can quickly identify that putting all your eggs in one basket is a terrible idea.

For more about investing in mutual funds, check out my related article, Exposing The Mutual Fund Industry.

As far as a financial adviser, look for someone who will teach you without pressuring you to make a purchase.  Ask them if they are a registered fiduciary and if they are not, ask why? 

Look for people who add value to your life and educate you before you give them your business.  Find an adviser who has his or her financial life in order.

Dave’s saying of, “don’t take advice from broke people” rings true even in the financial advisor world.  The fact that you are on this blog reading my articles shows that you are headed in the right direction.

It’s about establishing trust and credibility.  Taking financial advice from broke people is not a good game plan. 

Finally, when you do meet with a financial advisor, make sure to ask them these 11 questions!

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About The Author

Ryan Luke is a father of three, a husband, finance blogger, and a full-time police officer. Through proper budgeting and money management, they have been able to live off one income and build wealth at the same time. As an active member of the personal finance community, his goal is to educate and help people get out of debt and build wealth!

14 thoughts on “My Dave Ramsey Endorsed Local Provider Experience”

  1. very good article which reminds us all that we can get a lot of advice from smart people. However the final decision is ours and should be made after we get some facts to make the decision. Dont let the slick talkers in the business force you to make a decision that affects the rest of your life and lifestyle.Thanks for the information.

    1. How right you are! I’m a people pleaser so it’s hard for me to say “no” at times. By educating myself about personal finance, I have been able to say “no” more regularly to slick talking sales people, because I now understand their ulterior motives!

  2. I learned a lot from this one. And yes, the air continues to be let out from the Dave Ramsey balloon that I’ve been holding hahaha. Might challenge myself to read a finance book soon. Can you send that link to the post with books you recommend?

  3. Hi Ryan great post. I knew about fiduciary responsibility but did not know they can be switch hats when giving advice. I do think you can learn from broke people with a plan and are working towards building wealth as I am. You can also learn from their mistakes of what not to do.
    I am a Ramsey coach but I don’t think he is the end all be all when it comes to financial freedom. I think your best advice you mentioned was to do some reading and research of your own and figure out what works best for you!

  4. I always appreciate articles that serve to enlighten and protect those outside of the financial industry from those within it. I came to the same conclusion as you did and the more people that know this the better. “And knowing is half the battle” – G.I. Joe.

  5. I was an ELP in another area — Tax. When I called in to inquire, I thought I would be questioned closely to determine if I met their stringent standards; you know, questions about my experience, client service, niche specialties, etc. Nope. The only thing they wanted to know was whether I had the appropriate certifications (EA or CPA), and if I was willing to pay the price for the lead program. That was it. They didn’t run a background or credit check. Don’t get me wrong, I don’t enjoy those sort of interviews; yet, at the same time, I was a bit mystified by the stark contrast between the hype that ELP’s get when Dave does his promotions on his show and the reality that the “screening process” is little more than checking to see if the prospective ELP has a pulse.

    Now, I will also tell you that the quality of the leads is likewise wanting. Easily, 75% of them are garbage from the moment they hit my in-box. The remaining 25% are people that might end up being a profitable customer, yet many of them have very little buy in. Some live 50 miles away (the “local” part of ELP is very loosely defined), and aren’t going to drive that far just to get a tax return done, they were looking for an actual LOCAL provider. Some were simply curiosity seekers who wanted to see who the ELP was, but weren’t really interested in finding a new tax preparer (what they don’t realize is that there are multiple ELP’s in any one area, the leads are assigned randomly, there might of actually been one closer). And yes, there were some in people who were genuinely seeking out a tax preparer; most in the genuinely seeking category were people who had recently moved to the area. I’m guessing this profitable for Dave Ramsey and company, yet I’m having a hard time finding a profit paying big money for leads for Joe Sixpack type customers (good customers, yet are consuming at the basic level, don’t generate high fees).

    1. Hank, I’m sorry for the late response, your insightful comment went to the spam folder for some reason. Thank you so much for this first-hand perspective!

  6. I was looking for a site to post my experience with the Dave Ramsey ELP program as a Realtor. After 1 year I finally cancelled. I find it so contradictory to what he preaches as you not only pay $250 per month (at least I did) and receive minimal leads, but then you have to give them a 30% referral fee. I can go use so many other referral companies out there and pay 30% without the additional $250 per month. They claim the $250 isn’t for leads it’s for a monthly mastermind and other resources, even though the resources aren’t much of anything. I did like the Mastermind but it wasn’t life changing my any means. Sadly enough I was very disappointed with my year long relationship with them overall and I personally wouldn’t recommend it to anyone. I hope this helps someone out there determine whether to “pay” for the rights of being a preferred partner with Dave Ramsey.

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